Question
10.You have a choice of putting your $1,000 life savings into investment Uno (which bears 5 % per annum compound interest compounded annually) or putting
10.You have a choice of putting your $1,000 life savings into investment Uno (which bears 5 % per annum compound interest compounded annually) or putting your $1,000 into investment Duos (which bears interest at only 4% per annum, but is compounded semi-annually). Which investment is better for you if you invest for a year?
Uno is better in even numbered years and Duos is better in odd numbered years
Uno
There is not enough information provided to make an assessment
They provide identical returns
Duos1
9.If 8% is compounded quarterly for 3 years then the interest rate (r) for a single period used in a time-value money calculation would be
4%
3%
8%
2%
None of the other alternatives are correct
8.Chester borrows $50,000 from the Mighty Bank today and the Bank requests her to repay her loan in four equal payments along with 10% interest. Each of the four payments must be paid at the end of the next two years. What is the amount of each payment? Please round to the nearest whole number.
$15,106 plus 10% interest
None of the other alternatives are correct
$28,810
$15,106
$28,810 plus 10% interest
7.Your grand-mother puts $1,000 per year in a TD Bank account for you. She started doing this ten years ago to save for a big graduation trip after completion of high school and before starting university. Money is worth 12%. How much is sitting in the TD bank account as of now? Please round to the nearest whole number.
$10,000
$17,549
$3,016
$56,502
$11,200
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